PAM Transport Services Inc. of Tontitown has agreed to pay $4.75 million to settle a class-action lawsuit alleging that it violated state and federal minimum wage laws.
The suit, filed last year in federal court in Fayetteville, alleges that the transportation company failed to compensate drivers for the entirety of multi-day hauls. That includes hours when employees weren't driving but were still required to look after trucks and cargo, or had to sleep in the trucks.
PAM allegedly also charged fees for paycheck advances that were higher than the 10% limit allowed by law, and it deducted wages from driver paychecks until $500 was accumulated for an "escrow account" to recoup such advances.
Under the agreement, PAM will be released from claims by about 7,965 drivers for any wage violations that occurred between Jan. 1, 2020 and July 31, 2022.
A brief filed earlier this month in support of the settlement says that PAM has stopped charging service fees for wage advances and ended its policies requiring drivers fund escrow accounts through wage deductions.
U.S. Judge P. K. Holmes III still has to approve the settlement.
PAM settled a similar lawsuit for $16.5 million in 2020.